Tag Archives: First Solar

The 4 Favorite Stocks for Short-Sellers

By Dan Caplinger, The Motley Fool

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Most investors own stocks in the hopes of seeing them rise in value over the years. But for short-sellers, betting against stocks is the name of the game, and profits come when share prices fall.

Short-selling has always had a somewhat questionable reputation among mainstream investors, with many companies prevailing on those negative attitudes to blame short-sellers for share-price declines. But often, short-sellers direct their efforts at companies that are fundamentally weak, and as a result, watching the short-interest figures that stock exchanges provide can clue you in to stocks that are especially risky or are facing major obstacles.

With that in mind, let’s look at the four S&P 500 stocks that have the highest percentage of their available share-float sold short, according to the latest available figures from S&P Capital IQ.

J.C. Penney , short position: 55.5% of float and 25.6% of outstanding shares
This retailer’s recent travails are well known, as J.C. Penney tried and failed to transform itself from a coupon-driven discount retailer to a more attractive destination for shoppers. With the Ron Johnson experiment having backfired, the company has recently started to move back toward its original focus, albeit trying to hang onto some of the progress it has made with store renovations and in-store specialty shops. Despite recent news that George Soros has taken a substantial position in the stock, short-sellers think that the retailer is doomed to eventual failure as its competitors have already taken advantage of its weakness.

GameStop , short position: 38.1% of float and 37.2% of outstanding shares
GameStop has seen its stock rise sharply recently, hitting five-year highs as bullish investors look forward to a new wave of video game consoles expected to hit the market in the near future. Yet even though new consoles will drive sales for GameStop in the short run, short-sellers are focused on longer-term challenges to the retailer’s business model. With increased digital distribution from gamemakers and other measures that make reselling old unwanted games more difficult, GameStop could lose a big portion of its used-game inventory, which is a major profit center for the company.

First Solar , short position: 30.4% of float and 21% of outstanding shares
The solar industry has been hit hard by overcapacity, but First Solar shocked bears earlier this month with guidance on sales and earnings that was far above what industry analysts were expecting. Moreover, its purchase of TetraSun will help First Solar boost the efficiency of its solar modules, an area in which the company has long lagged some of its competitors. Short-sellers are feeling the squeeze as a result of much higher share prices recently, although the stock still trades well below its levels from early 2011. It’ll be interesting to see whether they’ll give in and cover their positions in light of the news.

U.S. Steel , short position: 29.4% of float and 29.3% of outstanding shares
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Source: FULL ARTICLE at DailyFinance

What Value Does Warren Buffett See in Solar?

By Travis Hoium, The Motley Fool

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Solar power has a growing presence in the U.S., which can be a contentious topic after a few high-profile failures in the industry. But Warren Buffett, arguably the best investor of our time, had invested billions of dollars in the industry long before most investors started making such bets. Why is he investing in solar when others are questioning it? Here’s a peak into what Buffett sees in solar.

On a quest for yield
Warren Buffett isn’t making just any investment in solar. Berkshire Hathaway‘s subsidiary MidAmerican Energy is buying huge solar projects with long-term power purchase agreements. As these projects generate electricity the contracted utility pays a set rate per kilowatt hour, which is negotiated long before a project is ever built. Since the cost of the project is fixed when Buffett buys it and the cash flows are easily predictable, in essence, Buffett is buying an asset similar to a bond, something he is very comfortable with.

The size of the investments Buffett is making is what makes his fascination with solar astounding. He owns two projects built by First Solar , including 49% of Agua Caliente, which he co-owns with NRG Energy , and a third project called Antelope Valley, the largest solar power plant in the world, which is currently under construction by SunPower .

 

Builder

Project Size

Cost

Ownership

Agua Caliente 

First Solar

290 MW

$1.8 billion

49%

Topaz 

First Solar

550 MW

$2 billion

100%

Antelope Valley 

SunPower

579 MW

$2.5 billion

100%

An investor as conservative as Warren Buffet wouldn’t make $5.4 billion in total investments in solar if he couldn’t reasonably predict the costs and revenue associated with such projects. That’s the big development in solar over the past half-decade, the industry can now build predictable models for projects all around the world, making it an investment even Warren Buffett could love.

Tax benefits
Another thing Buffett likes about solar is the tax benefits that come with it. Once these solar projects are completed Berkshire Hathaway will be eligible for a 30% investment tax credit, which he can write off against profits elsewhere in the business.

Solar projects are also eligible to be written off more quickly than most capital investments. Under federal law, Berkshire Hathaway can depreciate these projects over just five years with what’s called the Modified Accelerated Cost-Recovery System. This means that Buffett will save money on taxes in the first five years that the projects are on the books and, in turn, pay more in taxes later in the project’s life. The amount of taxes paid won’t change (assuming there is no change in policy), but for a business paying taxes later is always better than paying taxes earlier.  

Investments only Warren Buffett can make
The other big benefit Warren Buffett has over you and me is his ability to borrow

From: http://www.dailyfinance.com/2013/04/17/what-value-does-warren-buffett-see-in-solar/

4 Left-For-Dead Stocks That Are Back and Better Than Ever

By Dan Caplinger, The Motley Fool

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You can break the stock market into two categories: stocks that are on their way up, and stocks that are on their way out. In general, once a stock breaks, it takes a lot of effort to execute a solid turnaround and get the share price moving in the right direction again.

Yet just because it takes effort doesn’t mean it can’t be done. Today, let’s look at four stocks in the S&P 500 that sank to nearly the bottom of the index in terms of market capitalization, but which have since posted some impressive gains to get moving in the right direction once again.

First Solar , up 69% in the past year
The solar industry has gone through a huge amount of turmoil in the past year, as overcapacity from China and falling subsidies from across the world threatened the viability of many solar companies. But industry leader First Solar was able to weather the storm, using its size advantage and project backlog to help it stay profitable even in the face of bankruptcies and other financial difficulties among its Chinese rivals.

Much of the stock‘s gains have come in just the past week, as First Solar took a big step forward in solar- efficiency with a new 16.1%-efficient module. Its acquisition of TetraSun could make it even more efficient, and combined with guidance that greatly exceeded analysts’ expectations and sent the stock up about 50% in a single day, First Solar appears to be on the mend in a major way.

Dean Foods , up 59%
This time last year, dairy giant Dean Foods was dealing with high commodity prices and squeezed margins as many of its buyers chose to emphasize private-label milk at cheaper prices. But in response, Dean finally started passing through costs to customers, and the results have been positive.

The biggest boost for the stock has come from its foray into organics, with its WhiteWave spinoff representing the culmination of its successful strategy. As Dean continues shedding noncore assets in order to reduce its massive debt burden, it should be able to reinvent itself as a pure play on milk — with attendant challenges but also substantial opportunities.

GameStop , up 55%
GameStop has suffered from the rise of Internet gaming, as the console-based games that it depends on for both new and used sales have fallen in popularity. With stale product offerings both on the hardware and software sides of the business and the move toward digital distribution, GameStop appeared endangered.

But now, big console makers are planning new offerings, which GameStop hopes will reinvigorate the industry. Given how long gamers have had to wait for a PlayStation 4, pent-up demand should lead to vigorous sales, and that in turn should give GameStop a much-needed lift.

MetroPCS , up 34%
In the fast-moving mobile revolution, the prepaid service that MetroPCS has traditionally relied on seemed

From: http://www.dailyfinance.com/2013/04/13/4-left-for-dead-stocks-that-are-back-and-better-th/

Is the United States on the Verge of Energy Independence?

By Doug Ehrman, The Motley Fool

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While in many ways alternative energy remains in its infancy, continuing developments have put the U.S. in a better position relative to energy independence than seemed even thinkable a decade ago. The advent of hydraulic fracturing — known as fracking — has opened up a significant oil and gas supply that continues to lower the need to import resources from abroad. Similarly, advances in solar energy are making it an increasing viable solution, and positive guidance from the solar sector supports this belief. Finally, the U.S. is sitting on huge deposits of kerogen that could contain as much as 6 trillion barrels of oil if it could be extracted.

A case for liquefied natural gas
While thus far liquefied natural gas, or LNG, has remained impractical and unavailable in smaller, non-commercial vehicles, there has been an increasing push toward adopting this fuel for larger applications. Within the past month, Warren Buffett’s Berkshire Hathaway announced that it’s rolling out a pilot program to test the viability of using LNG to power locomotives at its BNSF Railway. The rail company is the second largest consumer of diesel in the country, using more fuel than any entity other than the U.S. Navy. If rail could effectively switch to LNG, the reduction in oil consumption would be dramatic.

This type of reduction would serve to continue a trend that has already begun. According to the U.S. Department of Energy, oil imports have fallen from a peak of 60% of consumption being supplied by foreign oil to 32%; furthermore, since total consumption has fallen, this means that the lower percentage is of an already smaller number. Similarly, according to a B of A Merrill Lynch estimate, where the U.S. spent $216 billion on natural gas in 2008, that number had fallen to $76 billion in 2012. A large factor for the decrease has been the explosion in supply from fracking operations.

Also aiding this effort is a push being made by Clean Energy Fuels to build enough LNG filling stations across the country to allow freight to traverse the U.S. in LNG-powered trucks. As the bulk of our goods still travels by truck, if these vehicles could be transitioned to LNG and away from diesel, consumption of foreign oil would fall even further. As the LNG trend continues, the position of the U.S. should continue to improve.

Solar flares
The second week of April saw solar companies explode to the upside, driven largely by bullish comments from First Solar about the company’s outlook for the rest of the year through 2015. The company also announced its acquisition of TetraSun under undisclosed financial terms. TetraSun brings expertise with silicon photovoltaic technology that’s been used by other leaders in the field. The acquisition should open up new avenues for First Solar and give the company the ability to improve overall efficiency.

On that front, Sun Power announced earlier this week that it was

From: http://www.dailyfinance.com/2013/04/13/is-the-united-states-on-the-verge-of-energy-indepe/

The 3 Biggest Surprises in Tech This Week

By Anders Bylund, The Motley Fool

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Say what you want about the tech sector, but it’s never boring. Any given week will keep tech investors flooded with product announcements, earnings surprises, and crazy strategy shifts that absolutely nobody saw coming.

These are three of the most shocking pieces of tech news this week.

That’s just ostrichious! Image credit: Flickr Commons.

The return of solar power
Solar-power giant First Solar published an updated revenue and earnings outlook for the next couple of years. The next day, shares soared 45.5% higher. At the midpoint of management’s guidance ranges, First Solar beat Wall Street‘s 2013 revenue target by 25% and next year’s estimates by 13%.

Investors were pleasantly surprised by First Solar‘s new targets, which include the impact of a recent acquisition. As the company incorporates TetraSun’s high-efficiency solar technology in its own products, First Solar will be able to enter whole new markets and offer better solutions at a lower cost.

“This breakthrough technology will unlock the half of the PV market which favors high-efficiency solutions, which has been unserved by First Solar to date,” said CEO Jim Hughes.

Are these BlackBerrys rotten?
Here’s one that will shock you one way or another, no matter which side of the street you’re on.

First, The Wall Street Journal reported that BlackBerry‘s new Z10 phones have been an unmitigated disaster. One analyst pinged his retail connections and found that “returns are now exceeding sales” of the Z10 in many cases. Another noted that sales started out poorly and “weakened significantly as the days passed.” This is the shocker if you believe in the new BlackBerry platform and hope that it will revive the company’s flagging fortunes.

So here’s a surprise for BlackBerry doubters. The company not only denies and refutes these claims, but it even filed complaints with the SEC and with Canadian market regulators.

“Everyone is entitled to their opinion about the merits of the many competing products in the smartphone industry, but when false statements of material fact are deliberately purveyed for the purpose of influencing the markets a red line has been crossed,” said BlackBerry’s chief attorney, Steve Zipperstein.

It’s one thing to shake your head and wag a finger at supposedly false conclusions, but it’s a whole ‘nother ballgame when the lawyers come marching in. Keep an eye on this unfolding drama with our Foolish watchlist feature.

The PC is dead!
Wait, wasn’t this old news already? The writing has been on the wall for months already.

Apparently not for many investors.

This week saw fresh PC sales estimates for the first quarter from analyst firms IDC and Gartner, and they both pointed to a drastic drop. IDC said unit sales fell 14% year over year, reaching rock-bottom levels not seen since 2009.

And yes, investors were flabbergasted. Shares of PC giant Hewlett-Packard traded 6.6% lower after these announcements, and Microsoft plunged 5%. You can bet that Dell would be in the dumps

From: http://www.dailyfinance.com/2013/04/13/the-3-biggest-surprises-in-tech-this-week/

Record Loans for Solar Power

By Aimee Duffy and Tyler Crowe, The Motley Fool

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Increasingly, companies with giant property footprints are going out of their way to power facilities with solar power. In this video, Fool.com contributor Aimee Duffy talks to fellow contributor Tyler Crowe about companies that are utilizing PACE bonds to improve their energy infrastructure and save money in the long term, and explains how the bonds work and how much money is involved along the way.

Investors and bystanders alike have been shocked by First Solar‘s precipitous drop over the past two years. The stakes have never been higher for the company: Is it done for good, or ready for a rebound? If you’re looking for continuing updates and guidance on the company whenever news breaks, The Motley Fool has created a brand-new report that details every must know side of this stock. To get started, simply click here now.

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From: http://www.dailyfinance.com/2013/04/12/record-loans-for-solar-power/

How First Solar Is Remaking Itself With New Tech And Leaders

By Ucilia Wang, Contributor A greater focus on research and development, a new crew of top executives and a plan to tackle a market segment that has eluded it now make up a new profile for First Solar, which until recently was in a race with its competitors in China to build large factories.

From: http://www.forbes.com/sites/uciliawang/2013/04/11/first-solars-makeover-with-new-tech-and-leaders/

Renewable Energy Joins the Army

By Aimee Duffy and Tyler Crowe, The Motley Fool

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The U.S. military has long been an innovator, and the field of renewable energy is no exception to that. In this video, Fool.com contributor Aimee Duffy talks to fellow contributor Tyler Crowe about the army’s recent announcement to build a solar farm in West Texas.  The 200-acre plant will be the military’s largest solar installation, capable of generating 20 megawatts of power. Aimee talks about the military’s commitment to alternative energy, which includes not only solar, but biofuels and energy efficiency initiatives as well.

Investors and bystanders alike have been shocked by First Solar‘s precipitous drop over the past two years. The stakes have never been higher for the company: Is it done for good, or ready for a rebound? If you’re looking for continuing updates and guidance on the company whenever news breaks, The Motley Fool has created a brand-new report that details every must know side of this stock. To get started, simply click here now.

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From: http://www.dailyfinance.com/2013/04/11/renewable-energy-joins-the-army/

First Solar Rockets Over the Moon to the Sun

By Doug Ehrman, The Motley Fool

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It is not often that positive guidance can drive a stock by nearly 50% in a single day, but remarks made by First Solar had precisely that impact. The news bodes well for the industry, and the company is not resting, but aggressively pursuing the add-ons it needs to succeed. After such a big run, you must ask yourself if this is only the beginning or is it rather a blip that will soon be corrected.

In the video below, Fool.com contributor Doug Ehrman discusses the most important elements of the company’s announcements and where the stock may go from here.

Investors and bystanders alike have been shocked by First Solar‘s precipitous drop over the past two years. The stakes have never been higher for the company: Is it done for good, or ready for a rebound? If you’re looking for continuing updates and guidance on the company whenever news breaks, The Motley Fool has created a brand-new report that details every must know side of this stock. To get started, simply click here now.

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From: http://www.dailyfinance.com/2013/04/11/first-solar-rockets-over-the-moon-to-the-sun/

Rumor Watch: Buffett Buying Suntech

By Michael Lewis, The Motley Fool

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Formerly the biggest maker of solar panels in the world, with more than 10,000 employees, China-based Suntech Power Holdings has witnessed a long fall from grace. The nail in the coffin came in March, when the company failed to pay a $513 million debt obligation. Shortly following its default, the company sailed into Chinese bankruptcy protection. Fast-forward to this week and the company is trading more than 30% higher on a largely speculative rumor that Warren Buffett is looking to buy it.

Rumor mill
Suntech Power has been licking its wounds since entering bankruptcy last month. Come Monday night, the company went from one of the worst-performing Chinese stocks to market darling after a Chinese news service reported that Berkshire Hathaway subsidiary MidAmerican Energy will likely buy the solar panel manufacturer.

This was enough to send the stock up more than 30% in Tuesday’s trading, with not a single official comment to be found.

I can’t say this definitely won’t happen, because I (along with nearly everyone else) just don’t know, but I honestly can’t imagine Warren Buffett (or Todd Combs, or Tedd Weschler) liking this business at all.

The Buffett checklist
Many analysts cite Buffett’s checklist (that doesn’t exist in any static form) for buying companies when trying to determine where his cash stash will strike next. How would Suntech fair if we hadn’t heard this rumor? Poorly.

The company operates in an industry that is incredibly lumpy with sharp shifts in demand and commodity-like competition. At the moment, there is a huge oversupply of solar panels, which is why manufacturers have gotten murdered in the markets. Management wasn’t able to effectively handle the company’s finances, and poorly leveraged its former position as market leader. The company is riddled with debt, has no moat, and operates in competition with another Buffett investment. The only thing that would be appealing is that its dirt cheap.

To be fair, the industry is showing signs of improvement. Another China-based manufacturer, Trina Solar , announced that it is targeting a return to profitability in the back half of this year. American firm First Solar soared this week on similar news. But does any of this suggest that Buffett would want to own one of these businesses?

Solar farming
Buffett already owns solar farms, and these are the types of businesses that make sense as they guarantee predictable, steady cash flows over a long period of time. They aren’t affected by the swinging demand for panels, and they aren’t at risk of constant technological disruption.

Berkshire has its solar exposure, and its in the better part of the business. What would Suntech contribute to the company’s portfolio?

Stay away
Plainly said, do not buy this rumor. Even if it is anywhere close to being true, and I am proved to be not as smart as Buffett (spoiler alert), you would be speculating, and that’s not a good habit to reinforce.

For solar exposure, read my article regarding installation and financier company

Source: FULL ARTICLE at DailyFinance

SunPower Solidifies Its Technology Lead

By Travis Hoium, The Motley Fool

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SunPower has released another industry-leading product, the 21.5% efficient X-Series panel. This is another step ahead of the competition for SunPower and solidifies the company’s lead against Chinese competitors and thin film maker First Solar . What does it mean for investors? The Motley Fool’s Erin Miller sat down with Fool.com contributor Travis Hoium to find out. 

On the other side of the efficiency spectrum, investors and bystanders alike have been shocked by First Solar‘s precipitous drop over the past two years. The stakes have never been higher for the company: Is it done for good, or ready for a rebound? If you’re looking for continuing updates and guidance on the company whenever news breaks, The Motley Fool has created a brand-new report that details every must know side of this stock. To get started, simply click here now.

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Source: FULL ARTICLE at DailyFinance

Did First Solar Just Upend the Solar Industry?

By Travis Hoium, The Motley Fool

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When First Solar announced the acquisition of TetraSun yesterday it really announced a fundamental shift in the company’s strategy. It isn’t giving up on thin film, not yet, but it is laying the groundwork for a future without its familiar CdTe panels. TetraSun is an investment in crystalline silicon solar cells that First Solar has been fighting against for over a decade. Silicon has won the battle, and now even First Solar will join the crowd.

The claims of TetraSun
First Solar says it is buying technology that will allow it to make panels that are more efficient and cheaper than competitors. So, is that claim really true? There are a lot of unknowns.

The press release from First Solar claims that TetraSun can make 21% efficient cells at costs similar to those of conventional multicrystalline silicon solar cells. If we use Trina Solar as the proxy, that means manufacturing costs of about $0.64 per watt.

The challenge is that TetraSun’s cost structure and manufacturing process are only hypothetical; at least on the scale First Solar needs to operate on. There’s no evidence that any significant manufacturing exists and First Solar is entering uncharted territory. It has no expertise with silicon and there have been plenty of new solar technologies that never lived up expectations. Evergreen Solar was supposed to have a better process for making silicon cells, amorphous silicon had high hopes, so did CIGS, and who can forget Solyndra.

But let’s assume that First Solar has a winner on its hands and TetraSun can produce 21% efficient cells at $0.60-$0.65 per watt. So what?

Another record in solar
We’ve been hearing about solar efficiency records for years. Yingli Green Energy said that its Panda cells reached 19.89% efficiency way back in 2011. Trina Solar‘s Honey technology can reach 19.6% efficiency. Then there’s the efficiency leader, SunPower , whose Maxeon cells can be 24% efficient, creating a 21.5% efficient production module.

The first thing to keep in mind with First Solar‘s claims is that cell efficiency and module efficiency are two different things, so let’s not jump to First Solar creating a 21% efficient module just yet. Even if TetraSun’s claims are true, a module would only be 18%-19% efficient, which isn’t off the charts against today’s competition.

 

Top Cell Efficiency

Top Module Efficiency

SunPower X-Series

24.0% 

21.5%

First Solar TetraSun

21.0%

~18.0%-19.0%

Trina Solar Honey

19.6%

17.4% 

Yingli Green Energy PANDA

19.9% 

16.5% 

Trina Solar Multicrystalline

n/a

16.0%

Yingli Multicrystalline

n/a

16.2% 

First Solar CdTe Panel

18.7% 

12.9%

Source: Company press releases and product datasheets.

The top cell and module efficiencies I’ve highlighted above also don’t account for a majority of sales at solar manufacturers. The multicrystalline lines from Trina and Yingli would be closer to an average efficiency of around

Source: FULL ARTICLE at DailyFinance

Can Big Oil Conquer Renewable Energy?

By Aimee Duffy, The Motley Fool

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BP recently announced it was bailing on its wind power initiatives. The company will sell its U.S. assets, which are spread across nine states and can generate about 2,600 megawatts of power. Estimates place the value of the assets at around $1.5 billion. After getting rid of its solar business, BP is sending a clear message about its commitment to renewables, which may lead investors to consider clean energy investments off-limits for big oil. In this video, Fool.com contributor Aimee Duffy reviews the BP move, and highlights the long-term potential of one oil major who is getting this bet right.

Not all renewable energy investments are created equal. Investors and bystanders alike have been shocked by First Solar‘s precipitous drop over the past two years. The stakes have never been higher for the company: Is it done for good, or ready for a rebound? If you’re looking for continuing updates and guidance on the company whenever news breaks, The Motley Fool has created a brand-new report that details every must know side of this stock. To get started, simply click here now.

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Source: FULL ARTICLE at DailyFinance

Dow Keeps On Keeping On

By Jeremy Bowman, The Motley Fool

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The Dow Jones Industrial Average hit yet another record high today, as stocks had a late-day run for the second session in a row today. The buying activity seems to indicate increased optimism about earnings season as the blue chips finished at 14.673, up 60 points or 0.4%, momentarily climbing above 14,700. Investors have now had a two-day breather from any significant economic reports or macroeconomic events, and stocks have made solid gains both days. Despite the continuing bull run, however, there have been 4.7 times as many negative pre-announcements as positive ones, the worst proportion since 2001, according to Thomson Reuters, indicating that there may be reason to fear earnings season.

Tech stocks led the Dow today, as Microsoft and Intel both moved up more than 3%. The Windows maker joined a group of tech companies including Oracle and Nokia filing a complaint against Google in the European Union, which accused the search giant of anti-competitive behavior in its Android strategy. One of the group’s lawyers called Android “a Trojan horse used to deceive partners, monopolize the mobile marketplace, and control consumer data.” Google has become a major rival of Microsoft’s in recent years, as Google vies for dominance in software with its Chrome Internet browser and Google Docs office products. Microsoft, on the other hand, has challenged Google’s search leadership with Bing and is also gunning for a piece of the smartphone and tablet market.

Intel, meanwhile, finished up 3.1% after it unveiled its new Thunderbolt interface technology yesterday, which runs at twice the speed of the previous model. The top chipmaker also said that it had begun shipping samples of a system-in-a-chip, known as “Avoton,” to Hewlett-Packard to be used in its new Moonshot servers. HP also finished the day up 1.5%.

One other sector flying high today was solar as First Solar jumped 46% after acquiring TetraSun, a Silicon Valley start-up, and providing an outlook way above Wall Street‘s estimates. The TetraSun acquisition, for an undisclosed amount, gives First Solar access to the higher-efficiency solar-panel market that its own panels are not suited for. The company also estimated EPS for the year to come in between $4 and $4.50, while Wall Street had projected just $3.51. The rally led other solar stocks up as well, as Yingli Green Energy finished up 21% and Trina Solar gained 15%.

On the other side of the spectrum, J.C. Penney dropped 12% as investors reacted to Ron Johnson‘s dismissal and replacement with Mike Ullman, the retailer’s former CEO. Johnson’s termination marks the end of a misadventure that included a new shops-within-the-shop strategy as well as the elimination of discounts that caused sales to drop by more than 25% last year. First-quarter same-store sales are also down 10% at Penney so far, according to The Wall Street Journal, indicating that the pain is far from over. What Mike Ullman‘s plans for the department-store …read more

Source: FULL ARTICLE at DailyFinance

First Solar Outlook Pushes Entire Solar Industry Higher

By Travis Hoium, The Motley Fool

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Maybe solar demand will be far better than we expected in the first half of 2013. That’s the thesis today after First Solar released a higher than expected full-year financial target.

At a conference today, First Solar said it expects 2013 sales to be between $3.8 billion and $4.0 billion, with earnings per share of $4.00-$4.50. That’s well above the $3.15 billion in sales and $3.46 per share earnings analysts had expected. When the numbers were announced, First Solar‘s shares shot higher and are up a whopping 48% at the time of this writing. 

Drawing wild conclusions
These numbers are outstanding and they’ve pushed the entire industry higher today. Yingli Green Energy is up 19% today, Trina Solar has jumped 12%, and LDK Solar is up 26% on hope that this will increase sales. Yingli and LDK, in particular, are two of the most highly leveraged companies in solar — the market is drawing the conclusion that higher sales at First Solar will be good for both, potentially leading to a profit later this year.

But let’s look closer at what First Solar had to say. Of the $3.8 billion-$4.0 billion in sales, $3.6 billion is expected to be in the systems business, a business Yingli, LDK, Trina, and most other Chinese manufacturers have little exposure to, especially outside of China. I don’t think we can draw the conclusion that a good year for First Solar will lead to a good quarter for Chinese solar because they have different businesses.

The real good news for First Solar
If you’re a First Solar investor then the improved guidance is good, but there’s even bigger news on the technology front. The company announced that it’s buying TetraSun, a PV start-up which has developed a cell architecture that can generate efficiencies exceeding 21% without the added cost that normally comes with high-efficiency modules. This is a direct shot at Chinese module makers like Yingli, LDK, and Trina Solar who have been able to take share because of low cost structures.  

What these companies don’t do well is research new technologies to increase efficiency. That usually falls on equipment makers like GT Advanced Technologies , who provide the equipment to make solar cells. But First Solar will now be boosting its efficiency capabilities, but SunPower is already well ahead with 21.5% efficient modules.

First Solar plans to launch this technology in the second half of 2014 and I’m sure we’ll hear more details about it when first-quarter earnings are released.

First Solar changes the game
It appears that First Solar will stick with the low-cost CdTe panels, which also got an efficiency boost today, in the utility-scale business, and use TetraSun to get into commercial and residential solar. First Solar has very little exposure to these two growing markets, which has investors concerned about reliance on giant utility-scale projects.

This is a huge catalyst for First Solar that could drive …read more

Source: FULL ARTICLE at DailyFinance

Is Warren Buffett Betting Big on Solar?

By Travis Hoium, The Motley Fool

Filed under:

Is Warren Buffett really interested in buying into the ultra-competitive Chinese solar industry? Bloomberg is reporting that Buffett has been sniffing around the remains of Suntech Power , formerly the largest solar manufacturer in the world. The company defaulted on U.S. loans last month and a unit in China entered insolvency, the equivalent of bankruptcy in the U.S.  

Why solar and why now?
This wouldn’t be Buffett’s first move into solar. He has spent billions buying projects from First Solar and SunPower in the southwestern U.S. But these projects aren’t manufacturing facilities like Suntech; they’re power plants that come with predictable costs and predictable cash flows, much more up Buffett’s alley.

The Bloomberg report suggests that Buffett is eying the future profitability of solar in the second half of this year. The profitability thesis is consistent with comments from SunPower and some Chinese manufacturers, but Suntech hasn’t even reported financial statements since the middle of last year. Even then, it was losing millions of dollars. Why would Buffett buy Suntech’s parent company if its largest subsidiary is bankrupt and the continuing operations are losing money?

Maybe he has his eye on the bankrupt portion of Suntech?

Buying on the cheap
What Buffett could conceivably be doing is looking at buying assets out of bankruptcy. Reports are that the banks Suntech owes want to liquidate the assets instead of restructuring debt and continuing operations. If Buffett made an offer for the assets that would exceed liquidation costs it could be a good deal for debtors.

This doesn’t seem like Buffett, though. Buying high-risk assets in a high-risk industry goes against everything he’s done for decades.

Not Buffett’s style
I would be shocked to see Warren Buffett acquire any part of Suntech because it simply doesn’t have the qualities he looks for in a company. It’s not profitable, doesn’t have a differentiated product, doesn’t have a competitive moat, and is on the cutting edge of a new industry. These are all qualities Buffett has stayed far away from in his career.

A more likely possibility would be a position in a U.S. manufacturer like SunPower or First Solar, but even that seems like a stretch. Buffett likes predictable cash flows and big competitive moats, something no one in solar can offer today.

Keeping tabs on one profitable solar company
Investors and bystanders alike have been shocked by First Solar‘s precipitous drop over the past two years. The stakes have never been higher for the company: Is it done for good, or ready for a rebound? If you’re looking for continuing updates and guidance on the company whenever news breaks, The Motley Fool has created a brand-new report that details every must know side of this stock. To get started, simply click here now.

…read more

Source: FULL ARTICLE at DailyFinance

First Solar Announces Full-Year 2013 Financial Guidance

By Business Wirevia The Motley Fool

Filed under:

First Solar Announces Full-Year 2013 Financial Guidance

2013 Net Sales of $3.8 to $4.0 billion

2013 earnings per fully diluted share of $4.00 to $4.50

Operating Cash Flow of $0.8 – $1.0 Billion

Summary outlook through 2015

TEMPE, Ariz.–(BUSINESS WIRE)– First Solar, Inc. (NAS: FSLR) today announced full-year 2013 guidance as well as summary financial targets through 2015.

For 2013, First Solar expects total module shipments to be between 1.6GW and 1.8GW and net sales of $3.8 and $4.0 billion, including approximately $3.6 billion in net sales from systems sales. Consolidated gross margin is expected to be between 20 and 22 percent. Excluding up to $10 million in restructuring expense as previously announced, diluted EPS is expected to be between $4.00 and $4.50, and consolidated operating income is expected to be between $430 and $460 million. The Company expects to generate $0.8 to $1.0 billion of operating cash flow and plans for approximately $350 to $400 million in capital expenditures in 2013. Working capital is expected to decrease by between $50 and $200 million from 2012. The Company noted that revenue recognition for the Desert Sunlight project is currently expected to begin in the second half of 2013 and conclude by late 2014. This assumption is reflected in the Company’s 2013 guidance and 2014 outlook.

In addition to the 2013 detailed guidance, the Company also provided a summary outlook for 2014 and 2015 as follows:

Big Risks and Big Rewards in Solar

By Travis Hoium, The Motley Fool

Filed under:

The solar industry has had a lot of negative headlines recently but it still offers big opportunities for investors. Keeping an eye out for differentiated products and superior balance sheets is key. Erin Miller sat down with Motley Fool contributor Travis Hoium to discuss what to look for in a solar stock and see what stocks he has his eye on.

Investors and bystanders alike have been shocked by First Solar‘s precipitous drop over the past two years. The stakes have never been higher for the company: Is it done for good, or ready for a rebound? If you’re looking for continuing updates and guidance on the company whenever news breaks, The Motley Fool has created a brand-new report that details every must know side of this stock. To get started, simply click here now.

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Source: FULL ARTICLE at DailyFinance

First Solar Sets CdTe Module Efficiency World Record, Launches Series 3 Black Module

By Business Wirevia The Motley Fool

Filed under:

First Solar Sets CdTe Module Efficiency World Record, Launches Series 3 Black Module

16.1 Percent Total Area Efficiency Module Confirmed by NREL;

Enhanced Series 3 Module Platform Certified for Desert Conditions & Field Durability;

Production Module Efficiency Roadmap Accelerated and Extended to 16.4-17.1 Percent for 2017

TEMPE, Ariz.–(BUSINESS WIRE)– First Solar, Inc. (NAS: FSLR) today announced it set a new world record for cadmium-telluride (CdTe) photovoltaic (PV) module conversion efficiency, achieving a record 16.1 percent total area module efficiency in tests confirmed by the U.S. Department of Energy’s National Renewable Energy Laboratory (NREL). The new record is a substantial increase over the prior record of 14.4 percent efficiency, which the Company set in January 2012. Separately, First Solar also set a record for CdTe open circuit voltage (VOC), a critical parameter for PV performance, reaching 903.2 millivolts (mV) in NREL-certified testing. This new record marks the first substantial increase in CdTe VOC in over a decade of international R&D. The new records come just six weeks after First Solar announced a new world record for CdTe solar cell efficiency of 18.7 percent.

First Solar‘s R&D team in Perrysburg, Ohio, set a new world record for CdTe module conversion efficiency, achieving 16.1 percent in tests confirmed by NREL. (Photo: Business Wire)

Transferring its success in the R&D lab to its commercial modules, First Solar also launched a new evolution of its proven Series 3 thin-film PV module platform, the Series 3 BlackTM, which incorporates First Solar‘s latest advances in conversion efficiency as well as additional features to enhance its performance in utility-scale power plants. The all-black module’s change in appearance results from the use of an advanced, all-black edge seal technology combined with an innovative encapsulation material that further enhances its field durability and demonstrates improvements in accelerated life testing results.

The Series 3 Black’s performance in a wide range of operating environments is further validated by its new IEC 60068-2-68 “sand and dust test” certification, which measures durability in harsh desert environments characterized by blowing abrasive sand. The certification complements existing IEC salt mist and ammonia certifications to provide a comprehensive range of independent testing that reflects world-class durability …read more

Source: FULL ARTICLE at DailyFinance

Jinko Solar Earnings: An Early Look

By Dan Caplinger, The Motley Fool

Filed under:

Spring is finally here, and a new earnings season is right around the corner. On Wednesday, Jinko Solar will release its latest quarterly results. The key to making smart investment decisions on stocks reporting earnings is to anticipate how they’ll do before they announce results, leaving you fully prepared to respond quickly to whatever inevitable surprises arise. That way, you’ll be less likely to make an uninformed knee-jerk reaction to news that turns out to be exactly the wrong move.

Chinese solar stocks have struggled especially hard lately, as a glut of capacity has made many players in the industry unprofitable. Jinko Solar actually earned an annual profit as recently as 2011, but its fortunes have reversed with most of its peers. Let’s take an early look at what’s been happening with Jinko Solar over the past quarter and what we’re likely to see in its quarterly report on Wednesday.

Stats on Jinko Solar

Analyst EPS Estimate

($0.80)

Year-Ago EPS

($2.58)

Revenue Estimate

$244.5 million

Change From Year-Ago Revenue

28%

Earnings Beats in Past 4 Quarters

1

Source: Yahoo! Finance.

Can Jinko Solar shine this quarter?
As dire as Jinko’s earnings appear, analysts haven’t gotten any more pessimistic about them in recent months, keeping their consensus views stable both for its most recent quarter and for full-year 2013. But the stock hasn’t been as fortunate, as it has lost a third of its value since the beginning of 2013.

Solar companies in China have largely survived poor conditions in the industry due to the generosity of government subsidies. Last December, China‘s Ministry of Finance set aside $1.1 billion in solar subsidies, while the Ministry of Science and Technology said it would provide subsidies to 100 different companies. While those subsidies help the industry as a whole, they don’t help shake out weaker players from the industry.

But Jinko may have an inside track to survival. The company got a $1 billion loan from the China Development Bank to help it with European solar projects. With a stronger balance sheet than many of its peers, Jinko appears better poised to survive the inevitable shakeout, while LDK Solar and Yingli Green Energy struggle under more substantial debt burdens. Already, the bankruptcy of Suntech Power has shown that China won’t rescue investors in every solar company.

Still, the fundamental problem in the industry is that capacity far exceeds demand. U.S. giant SunPower has a huge efficiency lead over its rivals, making it most likely to capture its share of the 30 gigawatts of demand that companies with 70 gigawatts of capacity are fighting over. Similarly, First Solar has found ways to remain profitable even with challenges from subsidy-supported Chinese rivals.

In its earnings report, watch carefully for Jinko to comment on the impact of the Suntech bankruptcy on its business. If Jinko can capture …read more

Source: FULL ARTICLE at DailyFinance